New Mexico Adjuster Practice Test

Correct answer: B. A self-employed person who settles home claims for several insurers for a fee

Investigating, negotiating and settling claims on behalf of insurers for a fee is the core of the adjuster definition in 59A-13-2(A)(1), so the self-employed person needs an independent adjuster license. Subsection B excludes people hired only to furnish technical assistance, such as engineers (B)(7), people who settle subrogation claims between insurers (B)(9), and appraisers who inspect and estimate damage but do not investigate, negotiate, settle or adjust claims (B)(6).

Reference: NMSA 59A-13-2(A)(1) and (B)(6), (7) and (9)

Correct answer: D. No adjuster license, because the agent exclusion applies

59A-13-2(B)(2) excludes from the definition of adjuster a licensed agent of an authorized insurer, or the agent's employee, who adjusts claims under specific authority from the insurer and solely under policies issued by that insurer. Rosa meets both conditions, so she needs no adjuster license. A staff adjuster is a salaried insurer employee, and a public adjuster works for insureds, so neither license fits her role.

Reference: NMSA 59A-13-2(B)(2)

Correct answer: A. The dwelling and contents claim, but not his injury claim

A public adjuster acts for an insured solely on first-party claims under policies insuring the insured's real or personal property (59A-13-2(A)(6)). The adjuster definition adds that an adjuster acting on behalf of an insured shall not investigate, negotiate, settle or adjust a claim involving personal injury to the insured ((A)(1)(a)). Lena may pursue the fire damage claim, but Omar's burns are outside her role, whatever the contract says.

Reference: NMSA 59A-13-2(A)(1)(a) and (A)(6)

Correct answer: C. The individual may not also be licensed as an independent or staff adjuster

13.4.8.17(A) and (B)(7) NMAC bar an individual licensed as a public adjuster from also being licensed as a staff or independent adjuster, and 59A-13-14(B)(6) bars a public adjuster from acting as either while so licensed. A business entity may hold both public and independent licenses, but an individual may not. The separate-application rule in 59A-13-7 lets one person hold both independent and staff licenses, not a public adjuster license alongside them.

Reference: 13.4.8.17(A) and (B)(7) NMAC; NMSA 59A-13-14(B)(6); NMSA 59A-13-7

Correct answer: D. Six months after the date of the last failed exam

59A-11-6(E) lets a candidate retake a failed exam at any later scheduled date, but someone who has taken and failed the same exam four times may not test again until six months after the date of the last exam failed. PSI's New Mexico candidate bulletin repeats this rule. Before the fourth failure, the practical limit is PSI's policy of not booking a new appointment on the same day as a failed attempt.

Reference: NMSA 59A-11-6(E); PSI New Mexico Candidate Information Bulletin

Correct answer: A. A grade of 70 passes, and a Spanish version is available on request

59A-11-6(D) makes a grade of not less than 70 a passing grade, and 59A-11-6(B) requires the examination to be given in Spanish if the applicant requests it; PSI lists a Spanish version of the 18-41 adjuster exam. New Mexico does not require a prelicensing course for adjusters, and PSI's bulletin says candidates may prepare with materials of their own choosing.

Reference: NMSA 59A-11-6(B) and (D); PSI New Mexico Candidate Information Bulletin

Correct answer: D. Pass the required licensing exam, since the waiver is now lost

Adjusters licensed before July 1, 2017 keep their exam waiver only while the license stays in force. 13.4.8.15(D)(1) NMAC says the waiver is lost if the license terminates for any reason after that date, expressly including loss of the staff adjuster's appointment, and the adjuster must then pass the exam before the license is reinstated. The one-year relicensing exemption in 13.4.8.12(B)(4) does not help him, because it excludes applicants who never passed a New Mexico exam.

Reference: 13.4.8.15(D)(1) NMAC; 13.4.8.12(B)(1) and (4) NMAC

Correct answer: B. Within 30 days; it ends unless reappointed within 30 more days

A staff adjuster must be appointed by an insurer to be licensed. Since the April 1, 2025 amendment, 13.4.8.15(C) NMAC requires notice within 30 calendar days of the termination (the earlier rule said 10 days), and the license terminates automatically unless OSI is told within 30 calendar days after that notice that another insurer has appointed the adjuster. A staff license never converts into an independent license.

Reference: 13.4.8.15(C)(1) and (2) NMAC

Correct answer: A. It is perpetual and renews every two years in the birth month

59A-11-10(A) makes the license term perpetual, contingent on paying fees and completing continuing education, and (B) says individual licenses renew every two years on the last day of the licensee's birth month. 13.4.8.13(A)(1) NMAC sets the fee due date as the last day of the second birth month after issuance, so a first term runs 13 to 24 months. Renewal requires CE from the preceding 24 months, not a new exam.

Reference: NMSA 59A-11-10(A) and (B); 13.4.8.13(A)(1) NMAC

Correct answer: C. She falls short, because at least 3 hours must be in a live format

Adjusters need 24 credit hours in each two-year compliance period, including at least 3 hours of ethics (13.4.7.9(A) NMAC), and 13.4.7.10(D)(2) requires at least 3 hours to be earned in a formal classroom or another format with a live instructor. Elena's hours are all self-study, so she is not yet compliant. Her extra hours would not help later either, because 13.4.7.9(B) bars carrying credit into the next period.

Reference: 13.4.7.9(A) and (B) NMAC; 13.4.7.10(D)(2) NMAC

Correct answer: B. Apply as a nonresident through NIPR; no New Mexico exam is needed

A nonresident who holds an active resident adjuster license of the same type in a state that requires an exam qualifies for a New Mexico nonresident license without taking New Mexico's exam (13.4.8.9(G)(4) and (5) NMAC). OSI's licensing instructions add that nonresidents need no New Mexico background check unless New Mexico will be their designated home state. The $10,000 bond applies only to public adjusters.

Reference: 13.4.8.9(G)(4) and (5) NMAC; OSI Individual Licensing Instructions (November 2025)

Correct answer: A. New Mexico will not accept a New York DHS, but a Texas DHS would qualify

Bulletin 2024-019 requires nonresident adjusters whose home state does not license adjusters to hold a designated home state license from an accepted state. Texas is on the accepted list with Alabama, Florida, North Carolina, Oklahoma and others, while New York is among the DHS states New Mexico will not accept, along with Arizona, Connecticut, Hawaii, Maine, Michigan, South Carolina and Vermont. Illinois issues no independent adjuster license for Aisha to obtain.

Reference: OSI Bulletin 2024-019 (October 1, 2024)

Correct answer: D. The applicant completed an approved adjuster prelicensing course

13.4.8.9(G) NMAC lists what the superintendent confirms before issuing a license: complete and truthful answers, an in-state residential or business address (a post office box does not count), a passed exam, at least five years of employment history without gaps, fingerprints for a state and federal background check, and the fee. A prelicensing course is not on the list; PSI's New Mexico bulletin states that no prelicensing study course is required.

Reference: 13.4.8.9(G)(1) to (9) NMAC; PSI New Mexico Candidate Information Bulletin

Correct answer: C. Public adjuster applicants only, for at least $10,000

Laws 2023, ch. 151 amended 59A-13-5 so that the surety bond of at least $10,000 is filed only with an application for a public adjuster license. 13.4.8.9(B)(7) NMAC, amended effective April 1, 2025, likewise ties the bond to public adjuster applicants, and OSI's licensing instructions say only public adjusters must file the $10,000 bond on the New Mexico bond form. Independent and staff adjusters file no bond.

Reference: NMSA 59A-13-5(A) (Laws 2023, ch. 151); 13.4.8.9(B)(7) NMAC

Correct answer: A. It is deemed approved for claims arising from the wildfire

Under 59A-13-6(D) and (E), a request to use emergency adjusters who are licensed and in good standing in their home state is deemed approved unless the superintendent disapproves it within three business days of submission, and the insurer may start using them while it waits. The adjusters may handle only claims arising from the emergency (B), and only during the 90 days immediately following it unless the superintendent grants an extension (C).

Reference: NMSA 59A-13-6(B) to (E); 13.4.8.18 NMAC

Correct answer: A. Independent: 3 years after completion; public: 5 years after the transaction ends

59A-13-10(B) requires an independent adjuster to keep records of each investigation or adjustment, including a statement of any fee or commission, for at least three years after completion and to make them available to the superintendent. Under 59A-13-17(B), a public adjuster keeps a complete record of each transaction, including the contract and an itemized statement of all compensation, for at least five years after the transaction with the insured ends.

Reference: NMSA 59A-13-10(B); NMSA 59A-13-17(B)

Correct answer: D. Not negotiate with her directly without her attorney's consent

13.4.8.14(A)(4) NMAC bars an adjuster from giving legal advice and from dealing directly with a policyholder or claimant who is represented by legal counsel without the consent of that counsel. It does not matter that Ana placed the call. Explaining her legal rights would also be legal advice, which no adjuster may give, so the adjuster should direct the discussion to her attorney.

Reference: 13.4.8.14(A)(4) NMAC

Correct answer: B. He may not adjust the loss on a property his company may repair

59A-13-13(A) prohibits an adjuster from adjusting a loss for physical damage to a property on which the adjuster is also a contractor or provides building repairs for compensation, or controls such a business, and (B) bars a contractor from acting as an adjuster on property it may repair. The disclaimer form in (C) only tells the insured which single capacity the person is serving in; it does not permit both roles on one property.

Reference: NMSA 59A-13-13(A) to (C); 13.4.8.14(B)(3) NMAC

Correct answer: B. Rescind it in writing within three business days of signing

59A-13-15(M) gives the insured the right to rescind a public adjuster contract within three business days after the date it was signed. The rescission must be in writing and mailed or delivered to the adjuster at the address in the contract within that period, so a phone call is not enough. If she rescinds, (N) requires the adjuster to return anything of value she gave within 15 business days after receiving the notice.

Reference: NMSA 59A-13-15(M) and (N)

Correct answer: C. Reasonable pay for his time and expenses, not a percentage fee

When the insurer, within 72 hours after the loss is reported, pays or commits in writing to pay the policy limit, 59A-13-15(F) requires the public adjuster to tell the insured the recovery might not increase, bars a commission based on a percentage of the amount paid, and limits the adjuster to reasonable compensation from the insured for time spent and expenses incurred. Kevin is not left with nothing, but his 10% term cannot apply.

Reference: NMSA 59A-13-15(F)(1) to (3)

Correct answer: B. $6,400

13.4.8.17(D)(5) NMAC caps any payment, commission or fee on a catastrophic disaster claim at 10% of the insurance settlement or proceeds, and 13.4.8.7(D) lets the President, the governor or the superintendent declare a catastrophic disaster. 10% of $64,000 is $6,400. The contract's 15%, or $9,600, cannot be collected above the cap.

Reference: 13.4.8.17(D)(5) NMAC; 13.4.8.7(D) NMAC

Correct answer: C. $2,000, which is 10% of that check

A public adjuster contract may not let the adjuster collect the entire fee from the first check an insurer issues; the fee is taken as a percentage of each check (59A-13-15(H)(2) and 13.4.8.17(D)(2) NMAC). 10% of the $20,000 first check is $2,000, and the rest of the fee comes from later checks as they are issued. The contract also may not let the fee be collected while money is due but not yet paid.

Reference: NMSA 59A-13-15(H)(1) and (2); 13.4.8.17(D)(2) NMAC

Correct answer: B. When done knowingly or often enough to be a business practice

The opening paragraph of 59A-16-20 makes the listed claim practices unfair and deceptive when an insurer or other person commits them knowingly or with such frequency as to indicate a general business practice. One knowing violation is enough, so no pattern count, complaint or court finding is required. Under 59A-16-30, a person damaged by a violation may also sue an insurer or agent for actual damages.

Reference: NMSA 59A-16-20 (introductory paragraph); NMSA 59A-16-30

Correct answer: C. An unfair practice, since it treats a mere inquiry as a claim

Laws 2025, ch. 120 added a paragraph to 59A-16-20 (now Subsection P) making it an unfair practice to treat an insured's inquiry about damage or loss as a claim when the facts of the inquiry are not covered by the policy, the insurer makes no payment, and the claim involves no deceptive practice by the insured. All three conditions are met, so logging the call as a claim violates the statute whether or not the premium changes.

Reference: NMSA 59A-16-20(P) (Laws 2025, ch. 120)

Correct answer: A. Within 90 days after Jamal reported the claim

59A-16-20(F) makes it an unfair practice to fail to settle catastrophic claims within 90 days after a catastrophic claim number is assigned, and 13.7.4.11 NMAC applies that period to claims existing at the declaration. A claim reported after the declaration is a post-declaration claim, and 13.7.4.12 gives the insurer 90 days after it is reported. Under 13.7.4.13, the period is tolled for documented suspected fraud or missing claimant documents.

Reference: NMSA 59A-16-20(F); 13.7.4.11 to 13.7.4.13 NMAC